HMRC’s new guidance service
HMRC has launched the first of its Guidelines for Compliance (GfCs). They are intended to be a one-stop resource for guidance on complex tax issues. The first, which is about PAYE settlement agreements, is now available.
Allowable deductions for new property rental
Repairs and maintenance expenses to refurbish a property after purchase but before lettings are capital and so not deductible from rental income to the extent they are required to bring the property up to letting standard. The balance of the expenditure can be deducted from rent in accordance with the pre-trading expenses rules.
Case law says that if a property was fit for purpose when bought, that’s to say it could be let, then all refurbishment expenditure is deductible from letting as income.
Tax-free benefit for workers
Clothing you provide employees to ensure their working environment is at a reasonable temperature doesn’t count as a taxable benefit, even where there’s some minor private use. To ensure the tax-free status, make it a rule that the extra clothing is intended for work use only.
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